June 24, 2010

Wal-Mart scores breakthrough with second Chicago store

Posted by John Byrne and Hal Dardick at 10:50 a.m.; last updated at 6:12 p.m.

In a move that could have nationwide implications for Wal-Mart’s expansion in major cities, the City Council Zoning Committee signed off today on a second store in Chicago.

The decision marks Wal-Mart's first victory in six years. The giant retailer overcame powerful union opposition that kept Chicago aldermen at bay as they weighed the prospect of bringing more jobs to their wards against the possibility of losing their own to labor-backed opponents at election time.

The breakthrough followed months of behind-the-scenes wrangling among unions and Wal-Mart over how much workers will get paid, with Mayor Richard Daley publicly exhorting the two sides to agree.

The deal struck Thursday has Wal-Mart assenting to pay at least $8.75 an hour — 50 cents more than minimum wage as of July 1. Unions once wanted $11.03 an hour, but settled for less and touted the company’s agreement to give raises of 40 to 60 cents an hour to Chicago workers after a year. A Wal-Mart spokesman, however, said store workers typically get that kind of bump anyway.

In the end, Wal-Mart appears on its way to getting a second store. The unions, which won’t actually represent any of the workers, get to save face. And aldermen looking ahead to re-election in February get to avoid a repeat of 2007, when several of them lost after angry unions put up challengers who opposed Wal-Mart.

The full City Council will consider the plan next week to allow a Super Wal-Mart as part of the major Pullman Park development just west of the Bishop Ford Expressway on vacant land that was once the Ryerson steel mill in a part of the city that has no grocery store.

Opinions differ on whether Wal-Mart can translate the Pullman Park momentum into a successful push for dozens of Chicago stores, both big and small.

Labor leaders pointed out their cooperation with Wal-Mart extends only to the second store.

“There are 21 more stores that are going to come in,” said Dennis Gannon, president of the Chicago Federation of Labor. “We are going to hold Wal-Mart accountable at every…step of the road, to make sure they are living up to their side of the agreement.”

Some aldermen, however, already are looking down the road at a Chicago filled with Wal-Marts.

“I think the eyes of the nation really are on this chamber today,” said Ald. Edward Burke, 14th, who noted Wal-Mart has been stymied in its bids to open stores in Los Angeles, New York and other large cities. “Up until this point, they haven't been able to get into Chicago. This is going to change their opportunities, not only in Chicago, but nationwide.”

Ald. Anthony Beale, whose 9th Ward is home to the Pullman site, said he expects Wal-Mart will move quickly to increase its presence in the city.

“Pandora's box is open. I'm sure they're going to aggressively start looking at different locations to open up,” Beale said.

Posted earlier today...

A second Wal-Mart store in Chicago got the go-ahead from the City Council Zoning Committee today after labor leaders announced they had reached accord with the giant retailer about pay for workers.

The plan for a South Side Wal-Mart as part of a development called Pullman Park passed the committee unanimously, as supporters who packed council chambers applauded. The development plan next heads to the full City Council for consideration.

The vote came after union leaders announced today they were dropping their long-standing opposition to the second store after reaching an agreement with Wal-Mart officials.

Dennis Gannon, president of the Chicago Federation of Labor, said the
agreement covers only the Pullman Park store, not the major expansion Wal-Mart envisions in the city.

But it is a template, and if Wal-Mart lives up to the terms at the new store, unions could support further expansion in Chicago.

“This is strictly on the Pullman agreement,” Gannon said. “There are 21
more stores that are going to come in. We are going to hold Wal-Mart
accountable at every . . . every step of the road, to make sure they are
living up to their side of the agreement.

Wal-Mart employees would get at least $8.75 an hour to start,
and a raise of 40 to 60 cents an hour after one year. "They are
guaranteed a 40 cent increase after that first year," Gannon said.

Unions have blocked Wal-Mart's long-coveted city expansion for six
years, but pressure was turned up starting late last year by Mayor
Richard Daley and pro-Wal-Mart aldermen who want the new jobs in a down
economy.

“Chicago knows we need jobs and we need ‘em now,” Gannon said.
“Organized labor has never been against jobs. Jobs is what we fight for
day in and day out. But good-paying jobs is something that we all strive
for.”

Although the unions initially asked that Wal-Mart pay its workers at
least $11 an hour, they compromised and sought a dollar above the
minimum wage of $8.25 that will go into effect on July 1.

They also asked Wal-Mart to hire most of its employees locally and use
all union labor to build its store, terms the giant retailer has agreed
to.

“We have been successful on all fronts,” ‘Gannon declared. “We have
tried to work out an agreement to the best of our abilities. We are not
demanding that Wal-Mart needs to be union, but we are demanding Wal-Mart
respect its workers.”

Also participating in the talks was Ron Powell, president of United Food
and Commercial Workers Local 881, who called the recent events
historic. “It’s the first time in the history of North America, south of
the Canadian border, where Wal-Mart has participated in discussions
with a local union,” he said.

“We are committed to ensuring that Wal-Mart will not deny the workers in
the city of Chicago their rights,” he said. “Around the world, this
corporation has routinely mistreated its employees and violated labor
laws. We are not going to let that happen here in the city of Chicago.”

Although some aldermen privately noted Wal-Mart already paid more than
minimum wage and increase salaries after a year and questioned whether
the unions had caved to the pressure, Jorge Ramirez, secretary treasurer
of the Federation of Labor, disputed that notion.

“Because we demanded more and we never let up, future Wal-Mart workers
here in the City of Chicago will earn more than anywhere else,” he said.

Comments

Why are people complaining about $8.75/hr. If you are working at Walmart for a career then u have more issues than your hourly wage. And when do unions have a right to tell a private company that they can not be in a certain place.

It's outrageous that the unions, representing a tiny 12% of American workers (88% of Americans who have a job are not in a union), can dictate which private companies can and cannot open a store in Chicago. Their behavior on this issue, on McPier (driving away convention business because they have demanded way more salary/benefits than the market will tolerate), on the issues of public education in Illinois and nationwide (opposing performance standards and insisting on only tenure for crappy teachers) may help their members in the short term (those members that get to keep their jobs once companies have to tighten the belt and lay people off to respond to the artificially high wages) but they hurt all of us in the long run. Their time has come and gone.

Cheers for food for the people that live around Pullman. Cheers for 700 new jobs paying well above minimum wage (WM already paid above minimum on average without union pressure, but...). Cheers for common sense.

With WalMart there is no gain in employment. The jobs will come at the expense of employees displaced elsewhere. WalMart workers alreadyin washington state already get more than the proposed $8.65 because of a higher minimum wage. The fact that these jobs are so desperately wanted should probably serve as an indicment of the public school system.

So, Wal-Mart gets their way, again. And they get to take credit for agreeing to pay a wage that is "poverty" in the city of Chicago. But you got a "job", right?

Well, you better enjoy those slave wages and suspect products while you can, because in about 5-10 years the store will be nothing more than another abandoned building, and any small business located within 5 miles of their store along with all of the tax revenues you, the taxpayer, gave to the largest private employer in subsidies just to set up shop will be a distant memory.

Congratulations, Chicago has officially sold itself into slavery and its master is Wal-Mart.

Why do some many people think Wal-Mart is going to solve all the problems? They put a Wal-Mart grocery store on the east side of Indianapolis, drove past it on the way to the in-laws. I shopped once in that store and only once, this was shortly after it opened. In less than a year, the gas station portion was closed due to too many problems and within two years the store itself was closed. It was a security nightmare there, why I only went one time and why it closed. Due to the high unemployment in the area, people ripped that store off and frightened away customers. This was not a positive addition to the community. People were cheering when it was built and they were the same people who ripped it off (many were employees who tried to steal stuff)

please note no WALL-MARTS IN SAN FRANCISCO LAS ANGELOUS- NEW YORK - THEY ARE VERBOTTEN IN ALL AMERIACAN TOWNS DOES THAT SAY SOMETHING ABOUT THE WA Y THEY OPERATE THEY DO NOT LIKE THE AVERAGE PERSON LOW WAGES POOR WORKING CONDITIONS WORKING OF THE CLOCK WITHOUT GETTING PAID

Welcome to the Thugocracy of Chicago. Where unelected union officials get to tell the sheep which non-union stores they'll allow to move in to their turf. But hey, the moron electorate keeps voting in the unions' Democrat puppets year after year. They get what they deserve.

I think that's good, I grew up in Pullman during the 50's. visited Pullman last year and found the people that live there have no where to shop. This will also help build up that area. My most beloved memories of my childhood were growing up in Pullman, I loved it!!

Wow. Amazing. We finally "let" the nation's largest retailer build a second store in the third-largest city in the United States, but conditioned on them being forced to use unionized labor, thus decreasing the net benefits to the community in terms of jobs and investment gains.

At a time when unemployment is near 10%, it's always wonderful to hear how the unions aremaking sure to 'take care of their own.' I hope union members are quite happy; hope it makes up for the fact that 1 in 10 of your fellow citizens don't have a job despite desperately wanting one.

For the life of me I cannot understand who the unions think they are to think they can block a company from building a store in Chicago. And why the city bows down to the unions and let them act as a block to this whole deal. Unions had their time in this country... and for a time they were needed. I work for a company that employs 20 union mechanics. I can tell you that some of the better mechanics would be paid better if they were not in the union. But we have to treat them as one so the better guys suffer at the hands of the slackers. Wal-Mart is not union. Can someone please explain how they got involved in this deal??

Good lord, a 40 cent raise after A YEAR? Most private employers give raises after 3 or 6 months... c'mon, how cheap are these people?

They drive all the mom & pop stores out of business, just like the big box stores do everywhere else. It's all for the big corporations in this country, and to hell with the little guy. You watch your neighborhood dry up and it will look like every single other place in America - Wal-Marts and McDonald's and all the other nationwide chains. The small businessman in America is an endangered species.

I am from Chicago and moved around due to being a miltary spouse. There are several Walmarts thru out and whenever I go home I often wonder why only one Walmart in town. This is going to be great for 2 of many reason 1 bigger and better, and 2 employment opportunity.

You know what, to hell with the unions. They continue to demonstrate that their strength is stopping progress - McPier, now Wal Mart - or extorting business to dilute competitiveness. Here's a thought, Dennis Gannon - how about Wal Mart continues to open locations in the suburbs and create greater-than-$0 paying jobs outside the city? Unions should all be dissolved.

It’s good to see Chicago’s South Side’s finally getting something good for their neighborhood. We’ve read for years about the need for stores selling affordable merchandise and providing jobs in a much neglected part of the city. Hundreds of jobs, many with wonderful growth potential becoming available at a much needed time will undoubtly provide many long range benefits to the community.

The story mentioned that a major deal was worked out between Wal-Mart and the Chicago Federation of Labor. It’s interesting to note that the C. F. of L. appears to be in charge here. Could this possibly be interpreted as Mayor Daley and his democratic machine is crumbling or at least in decay?

The union sold out the future employees 8.75 an hour is an embarrassingly wage. They people is the area need jobs but, they need jobs that pay a wage they can live not one where the government is going to have to supplement Wal Mart's employees. Does this agreement include health care for all the employees who wish to work full-time? Or is Wal Mart controlling the hours so that very few employees reach the level of full-time employees. That is pretty much their normal operating strategy.

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